TMX Group Limited announced an agreement to acquire RAFI Indices, LLC from Research Affiliates Global Holdings, LLC , a global index provider and investment advisor for US$490 million ($683 million¹) in total consideration. The acquisition will significantly expand equity portfolio coverage of TMX VettaFi, a differentiated index provider with modern distribution solutions, and TMX Group subsidiary.

Transaction Highlights:

• RAFI Indices’ pro forma run rate revenue was approximately US$49 million ($68 million¹) at March 31, 2026, and adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) was approximately US$38 million ($53 million¹).²
• Implied total valuation of US$393 million ($547 million¹) net of expected tax benefit with a net present value of approximately US$97 million ($135 million¹), primarily representing amortizable acquired goodwill and intangibles.
• The transaction will more than triple TMX VettaFi Assets Under Indexing (AUI) from approximately US$81 billion to US$263 billion³.
• Expected to be accretive to adjusted earnings per share⁴ within the first 12 months of closing, excluding synergies.
• Revenue growth is expected to be in-line with TMX VettaFi’s High Growth (high-single to double digit growth) over the long term.
• Will accelerate our key transformational measures, increasing recurring revenue, revenue outside Canada, and revenue from Global Insights.
• Transaction is expected to be financed with debt, and pro forma leverage ratio, including the previously announced and pending Cboe Australia and Cboe Canada transaction, is expected to be approximately 2.7x⁵ after closing, with plans to return to target leverage range one-year post close.

“RAFI Indices brings a legacy of deep research and pioneering methodologies that align with TMX VettaFi’s commitment to providing innovative and data-driven investment solutions,” said Peter Conroy, CEO, Global Insights, TMX Group. “By combining RAFI Indices’ world-class intellectual property with our modern “Index Factory” technology and distribution platform, we are expanding the toolkit available to our partners to include some of the most respected fundamental strategies in the industry.”

RAFI Indices is an index company founded by Research Affiliates. It specializes in constructing, publishing, and licensing indices that reflect a deep, academically rigorous understanding of the fundamental factors driving capital market returns. The company is renowned for its innovative approach, offering over 90 indices that cater to a diverse range of investment needs worldwide.

“Today we begin an exciting new chapter in the RAFI story. Our simple idea of creating an index strategy that selects and weights using fundamental measures of size, rather than price or market value, advanced the state of the art for equity investing,” said Rob Arnott, Founding Partner and Board Chair of Research Affiliates. “With TMX VettaFiʼs resources and our shared vision, they will be properly equipped to take RAFI, and our newer strategies in cap-weighted core and growth investing, to new levels of global success.”

Completion of this transaction is anticipated to close by the end of Q3 2026, subject to regulatory approval and customary closing conditions.

TD Securities served as financial advisor and WilmerHale LLP acted as legal counsel to TMX Group. Ardea Partners LP served as financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as legal advisor to Research Affiliates. National Bank of Canada and The Toronto-Dominion Bank are providing new committed credit facilities to TMX Group.

Source: TMX Group